CALGARY
Suite 660, 1509 Centre Street SWCalgary, Alberta T2G 2E6T 403.705.3535 F 403.444.5053
EDMONTON
Suite 101, 13245-140th Avenue NWEdmonton, Alberta T6V 0E4T 780.702.3066 F 780.702.3070
WINNIPEG HEAD OFFICE
300 - 360 Main StreetWinnipeg, Manitoba R3C 3Z3T 204.947.1250 F 204.947.0453
TORONTO
Suite 1802, 415 Yonge StreetToronto, Ontario M5B 2E7T 647.955.3755 F 647.977.9072
PHOENIX
Suite 280,16220 N. Scottsdale RoadScottsdale, Arizona 85254T 480.483.4111 F 480.556.9987
www.artisreit.comAX.UN - TSX
STAMPEDE STATION, CALGARY, AB
NORTH SCOTTSDALE CORPORATE CENTER II, SCOTTSDALE, AZ
TWO MARKETPOINTE, MINNEAPOLIS, MN
TABLE OF CONTENTS
01 Message to Unitholders
03 Internal Growth Strategy
04 External Growth Strategy
06 Portfolio Assets
09 Strong Financial Position
10 Artis’ Executive Team
11 Outlook12 Artis’ Trustees, Corporate
Governance and Sustainability13 Corporate Information
ANNUAL REPORT 2013
ARTIS REAL ESTATE INVESTMENT TRUST
ON THE COVER:MAX AT KIERLAND, SCOTTSDALE, AZ
99RATING
PROPERTIES OF SUCCESS
77RATING
94RATING
Artis is one of the largest diversified commercial real estate investment trusts in Canada. Over the last 10 years, Artis has executed an aggressive but disciplined growth strategy, building a portfolio of office, retail and industrial properties in Canada and select U.S. markets with a major concentration in Western Canada.
Artis’ external growth strategy is to pursue high-quality accretive acquisitions, and when prudent, to invest in high-yield development opportunities in our established target markets. Artis’ internal growth strategy is to extract maximum financial value from our existing commercial properties by capitalizing on below-market rent opportunities, through selective redevelopment and repositioning of well-located assets in primary markets, and from new construction and expansion of existing portfolio properties.
COMPANY PROFILE
CALGARY
Suite 660, 1509 Centre Street SWCalgary, Alberta T2G 2E6T 403.705.3535 F 403.444.5053
EDMONTON
Suite 101, 13245-140th Avenue NWEdmonton, Alberta T6V 0E4T 780.702.3066 F 780.702.3070
WINNIPEG HEAD OFFICE
300 - 360 Main StreetWinnipeg, Manitoba R3C 3Z3T 204.947.1250 F 204.947.0453
TORONTO
Suite 1802, 415 Yonge StreetToronto, Ontario M5B 2E7T 647.955.3755 F 647.977.9072
PHOENIX
Suite 280,16220 N. Scottsdale RoadScottsdale, Arizona 85254T 480.483.4111 F 480.556.9987
www.artisreit.comAX.UN - TSX
STAMPEDE STATION, CALGARY, AB
NORTH SCOTTSDALE CORPORATE CENTER II, SCOTTSDALE, AZ
TWO MARKETPOINTE, MINNEAPOLIS, MN
TABLE OF CONTENTS
01 Message to Unitholders
03 Internal Growth Strategy
04 External Growth Strategy
06 Portfolio Assets
09 Strong Financial Position
10 Artis’ Executive Team
11 Outlook12 Artis’ Trustees, Corporate
Governance and Sustainability13 Corporate Information
ANNUAL REPORT 2013
ARTIS REAL ESTATE INVESTMENT TRUST
ON THE COVER:MAX AT KIERLAND, SCOTTSDALE, AZ
99RATING
PROPERTIES OF SUCCESS
77RATING
94RATING
Artis is one of the largest diversified commercial real estate investment trusts in Canada. Over the last 10 years, Artis has executed an aggressive but disciplined growth strategy, building a portfolio of office, retail and industrial properties in Canada and select U.S. markets with a major concentration in Western Canada.
Artis’ external growth strategy is to pursue high-quality accretive acquisitions, and when prudent, to invest in high-yield development opportunities in our established target markets. Artis’ internal growth strategy is to extract maximum financial value from our existing commercial properties by capitalizing on below-market rent opportunities, through selective redevelopment and repositioning of well-located assets in primary markets, and from new construction and expansion of existing portfolio properties.
COMPANY PROFILE
FUNDS FROM OPERATIONSPER UNIT
2011 2012 2013
$1.21
$1.30 $1.46
REVENUESMILLIONS
2011 2012 2013
$290.5
$372.5
$463.4
TOTAL ASSETSMILLIONS
2011 2012 2013
$3,167.6
$4,380.1
GROWTH HIGHLIGHTS
INVESTOR HIGHLIGHTS FINANCIAL HIGHLIGHTS
2013 2012%
CHANGE
REVENUE 463,418 372,469 24.4%
PROPERTY NET OPERATING INCOME(PROPERTY NOI) 296,882 240,409 23.5%
FUNDS FROM OPERATIONS (FFO) 183,467 140,146 30.9%
FFO PER UNIT 1.46 1.30 12.3%
FFO PAYOUT RATIO 74.0% 83.1% 9.1%
ADJUSTED FUNDS FROM OPERATIONS (AFFO) 156,761 122,702 27.8%
AFFO PER UNIT 1.26 1.15 9.6%
AFFO PAYOUT RATIO 85.7% 93.9% 8.2%
DISTRIBUTIONS PER UNIT 1.08 1.08 -
GROSS BOOK VALUE (“GBV”) 5,043,254 4,380,766 15.1%
MORTGAGES, LOANS AND BANK INDEBTEDNESS TO GBV 45.4% 47.3% 1.9%
($000’S EXCEPT PER UNIT AMOUNTS)
TRANSFER AGENTCST Trust CompanyPhone: 1.416.682.3860 or 1.800.387.0825Toll Free throughout North AmericaFax 1.888.249.6189canstockta.ca
INDENTURE TRUSTEEBNY Trust Company of CanadaPhone 1.800.254.2826Fax 1.416.360.1711bnymellon.com
AUDITORSDeloitte LLP
LEGAL COUNSELAikins, MacAulay & Thorvaldson LLP
STOCK EXCHANGE LISTINGS
Toronto Stock Exchange
Trust Units AX.UN
Preferred Units Series A AX.PR.A Series C AX.PR.U Series E AX.PR.E Series G AX.PR.G
Convertible Debentures Series F AX.DB.F Series G AX.DB.U
2013 DISTRIBUTIONS
Trust Units$0.09 per unit per month
Series A Preferred Units$0.328125 per unit per quarter
Series C Preferred UnitsUS$0.328125 per unit per quarter
Series E Preferred Units$0.328600 per unit for the initial period ended June 28, 2013$0.296875 per unit for the quarters ended September 30, 2013 and December 31, 2013
Series G Preferred Units$0.321900 per unit for the initial period ended October 31, 2013
2013 TAXABILITY OF DISTRIBUTIONS
88% of distributions to Unitholders and preferred Unitholders in the taxation year were classified as return of capital. 11.64% was classified as investment income and 0.36% was classified as capital gains.
INVESTOR [email protected]: 1-800-941-4751
Artis Real Estate Investment Trust 13
CORPORATE INFORMATION
• WELL DIVERSIFIED CANADIAN COMMERCIAL REIT
• 25 MILLION SQUARE FEET OF OFFICE, RETAIL AND
INDUSTRIAL SPACE
• OVER 230 PROPERTIES IN WESTERN CANADA, CENTRAL
CANADA AND SELECT U.S. MARKETS
• TSX-LISTED REIT OFFERING A SELECTION OF EQUITY INVESTMENT OPTIONS FOR INVESTORS
• TRUST UNITS EARN A STABLE AND TAX-EFFICIENT
MONTHLY DISTRIBUTION OF $1.08 PER UNIT PER ANNUM
• PREFERRED UNITS EARN A STABLE TAX-EFFICIENT
QUARTERLY DISTRIBUTION, IN CANADIAN AND IN SOME
CASES U.S. DOLLARS
• PROVEN TRACK RECORD OF ACCRETIVE GROWTH: 2011 - 2013
• 59% INCREASE IN ASSETS
• 60% INCREASE IN REVENUES
• 21% INCREASE IN FUNDS FROM OPERATIONS PER UNIT
• STRONG FINANCIAL POSITION
• INVESTMENT GRADE CREDIT RATING OF BBB (L) AND
PFD-3 (L) FROM DBRS
• DECREASING LEVERAGE AND PAYOUT RATIOS
• AMPLE CASH AND BORROWING CAPACITY
The information in this Annual Report should be read in conjunction with the REIT’s audited annual
consolidated financial statements and management’s discussion and analysis for the years ended
December 31, 2013 and 2012. These documents are available at www.sedar.com or on our web site at
www.artisreit.com.
Retail26%
Office50%
Industrial24%
ASSET CLASS DIVERSIFICATION(1)
AB39%
BC9%
MB12%
SK7%
ON13%
U.S. 20%
GEOGRAPHICAL DIVERSIFICATION(1)
$5,042.0
YEAR ENDED DECEMBER 31
(1) share of 2013 annual property NOI ANNUAL GENERAL MEETING
Main Floor Conference Centre360 Main StreetWinnipeg, Manitoba
Thursday, June 19, 201411:00 a.m. C.T.
MESSAGE TO UNITHOLDERS:
ARTIS’ GROWTH STRATEGY HAS DELIVERED EXCEPTIONAL RESULTS.
2013 has been another outstanding year for Artis. In an effort to deliver
exceptional results for our Unitholders, Artis has continued to pursue a
disciplined growth strategy which has resulted in the successful acquisition
of Canadian and U.S. commercial assets for $321.1 million and US$212.4
million respectively. These acquisitions significantly increased funds from
operations (“FFO”), revenues, and total assets while further diversifying our
commercial real estate portfolio both geographically and by asset class.
Artis has a best in class management team who successfully acquired
over $1.5 billion in commercial real estate over the last two years. We
have expanded the reach of our asset management platform with a newly
opened U.S. office, and have fully developed property management offices
operating in Edmonton, Calgary, Winnipeg and Toronto.
Successful execution of our external and internal growth strategy led
to improvements in virtually all of our key financial metrics in 2013. This
includes key per unit earnings metrics, payout ratios, and overall leverage
and interest coverage ratios. Notably, in 2013 we earned our investment
grade credit rating from DBRS, a significant accomplishment as there are
only a select few REITs and real estate operating companies in Canada with
an investment grade credit rating.
I would like to take this opportunity to thank our employees for making
Artis an award-winning Top 25 Employer in Manitoba. I would also like to
thank our management team and Board of Trustees for their contribution in
delivering another year of outstanding results, and look forward to reporting
on our progress next year.
Armin Martens, P.Eng.,MBAPresident & C.E.O.
ARTIS REIT
1700 BROADWAY, DENVER, CO
Artis is focused on generating internal growth from our
existing portfolio by capitalizing on below-market rent
opportunities and maintaining occupancy levels, as well as
through efficient and cost-effective property management
and leasing practices. As Artis has grown, we are increasingly
focused on internal growth opportunities generated by the
selective re-development and repositioning of well-located
assets in primary markets and from new construction and
expansions on existing portfolio properties.
As a part of Artis’ internal growth strategy, we were able
to capitalize on positive leasing activity through increases
in renewal rent rates in 2013 which were up 7.5% and 7.2%
in Q4 and year-over-year, respectively. 2013 Same-Property
NOI growth was 3.3%, and notably, Same-Property NOI
growth increased over the course of 2013, from 2.4% in Q1-
13 to 3.7% in Q4-13. At year end, management estimates
that market rents for leases expiring in 2014 and 2015 are
approximately 7.1% and 7.9% above existing in-place rents.
We believe this is an excellent indicator of potential revenue
growth to be gained from future leasing activities.
The management team continues to work diligently to
maintain occupancy over 95% consistently, and at December
31, 2013, occupancy plus commitments was a very healthy
96.2%. We take a focused and pro-active approach with
the leasing program, managing Artis’ lease expiry schedule
well ahead of time. In 2014, only 11.4% of leasable area
expires, of which over 36% has already been renewed or
committed to new leases.
In 2013 we increased our focus on revenue enhancing re-
developments and new development projects on excess
lands in the portfolio. These improvements may result in
new rentable area and revenue streams, or may enhance
the overall quality or attractiveness of the property, thus
increasing revenues, Property NOI and ultimately asset
values in the long run.
The Linden Ridge Shopping Centre expansion is an excellent
example: 87,000 square feet of new retail was developed on
excess lands in a vibrant and expanding retail node in south
Winnipeg, Manitoba. This new retail development has
been fully leased to national tenants, including Marshalls,
PetSmart, SportChek and Dollar Tree, and will be fully
occupied by Q1-14. In addition to improving our Property
NOI, the new tenants will increase traffic flows to the pre-
existing retail strip, thus improving leasing prospects and
the long-term viability of the shopping centre.
82RATING
Annual Report 2013 3
INTERNAL GROWTH STRATEGY
PRODUCTION COURT, BURNABY, BC
REPORTED HEALTHY
SAME-PROPERTY
NOI GROWTH OF
3.3% IN 2013
ARTIS REIT
MARKET RENTS ARE ESTIMATED TO BE 7% ABOVE CURRENT IN-PLACE RENTS
Artis has achieved a leading market position in the
commercial REIT sector, with its vastly diversified
portfolio of retail, office and industrial assets in Canada
and the U.S. As at December 31, 2013, Artis’ commercial
real estate portfolio consists of 24.8 million square feet of
leasable area in 232 properties in five Canadian provinces
and five U.S. states.
Artis’ external growth strategy is to pursue high-quality
accretive acquisition opportunities in our established
markets, and when prudent, to invest in high-yield
development opportunities in those markets. In 2013,
we delivered on that strategy, acquiring 13 properties
in Canada and the U.S., adding nearly 1.8 million square
feet of leasable area to the portfolio.
Notable 2013 acquisitions included the acquisition of
the Quarry Park Portfolio, a 282,327 square foot newly
constructed Class A, LEED Certified office portfolio in
Calgary, Alberta, and the acquisition of the DirecTV
Building, a 256,767 square foot Class A trophy office
building located in the Greater Denver Area, Colorado.
Artis also participated in the development of a 185,407
square foot industrial property in the Twin Cities Area,
Minnesota, which is now fully leased for a 10-year term
with annual rent escalators to a stable and high credit-
rated tenant.
U.S. STRATEGYArtis’ U.S. assets are located in five states, with a primary
emphasis on the Phoenix Metropolitan Area in Arizona,
the Twin Cities Area in Minnesota and the Greater Denver
Area in Colorado. In 2013, 19.9% of Artis’ Property NOI
was generated by our U.S. assets; at December 31, 2013,
we estimated that our pro-forma Property NOI from
our U.S. assets was 22.5%. Due to our success in these
markets, we recently increased our U.S. target weighting
to 30% of total Property NOI.
Artis was among the first Canadian REITs to enter the
U.S. commercial real estate market after the 2008/2009
financial crisis. As we looked to the U.S., we found that
unlevered yields were more accretive, tenant credit and
lease expiry profiles were more conservative, and asset
quality was superior compared to available acquisition
opportunity in Canada. Acquiring properties in the U.S.
thus improved the overall caliber of our portfolio. This
first mover strategy has proven to be timely. In addition
to benefiting from historically low interest rates, the U.S.
real estate market has rebounded significantly over the
last 4 years. As a result, between January 1, 2011 and
December 31, 2013, Artis recorded $49.8 million in fair
value gains on our U.S. property portfolio.
Close to half of the capital used to acquire new
properties in 2013 was spent on U.S. properties, at
capitalization rates much better than for comparable
properties in Canada. In 2013, Artis acquired
commercial properties for US$212.4 million, including
our first two properties in the Greater Denver Area,
as well as two properties in the Phoenix Metropolitan
Area and one in the Twin Cities Area. Artis has
solidified its position in the Twin Cities Area, and is
now the second largest industrial landlord in that
market.
CANADIAN STRATEGYArtis owns properties in the eastern province of
Ontario, and in the western provinces of Manitoba,
Saskatchewan, Alberta and British Columbia. The
Western Canadian provinces contributed 66.9% to our
annual 2013 Property NOI. We continue to believe
that Western Canada’s economic fundamentals, and
hence real estate fundamentals, will outperform the
Canadian average in the mid- to long term.
Our goal is to continue to acquire properties in our
Canadian target markets that are accretive and that will
improve the diversity, stability and quality of our portfolio.
In 2013, Artis acquired $321.1 million of Canadian
commercial properties, primarily in Western Canada.
The on-going internalization of property management
operations in Canada over time is also a key focus for us,
as we expect this will translate to long-term operating cost
efficiencies. At the close of 2013, we have fully staffed
property management offices in Calgary, Edmonton,
Winnipeg and Toronto, where our Canadian assets are
concentrated.
IN 2013 ARTIS ACQUIRED $321.1 MILLION OF CANADIAN AND US$212.4 MILLION OF U.S. COMMERCIAL PROPERTIES
Artis Real Estate Investment Trust 5
PTI BUILDING, EDMONTON, AB
EXTERNAL GROWTH STRATEGY
19.9% OF PROPERTY
NOI WAS
GENERATED IN
ARTIS’ U.S.
PORTFOLIO
ARTIS REIT
GSA PHOENIX PROFESSIONAL OFFICE BUILDING, PHOENIX, AZ
NANAIMO
NANAIMO
VANCOUVER / GVRD
KELOWNA
CRANBROOK
CALGARY
EDMONTON
RED DEER
MEDICINE HAT
EDSON
GRANDEPRAIRIE
FORTMcMURRAY
SASKATOON
MOOSE JAW
REGINA
ESTEVANWINNIPEG
MINNEAPOLIS/ TWIN CITIES
DENVER
PHOENIX TORONTO/ GTA
OTTAWA
DIVERSIFICATIONOVER 64% OF ARTIS’
TENANTS ARE
GOVERNMENT OR
NATIONAL
TOP TEN TENANTS BY PERCENTAGE OF GROSS REVENUE
MANITOBA TELECOM SERVICES, INC.
2.0%
AMEC AMERICAS LTD.
1.9%
TRANSALTA CORPORATION
1.1%
SHOPPERS DRUG MART
1.0%
CB RICHARD ELLIS, INC.
0.9%
TELVENT CANADA LTD.
0.9%
TD CANADA TRUST
0.9%
STANTEC CONSULTING, LTD.
0.9%
DIRECTV, LLC
0.9%
IHS GLOBAL CANADA LTD.
0.9%
Canarama Mall, Saskatoon, SK Horizon Heights, Calgary, AB
Home Depot, Richfield, MN
Sobeys, Moose Jaw, SKTransAlta Place, Calgary, AB
MTS Place, Winnipeg, MB
Aulds Corner, Nanaimo, BC
ARTIS’ TOP
TWENTY TENANTS
ACCOUNT FOR 19.4%
OF GROSS REVENUE
AND HAVE A 7.4 YEAR
WEIGHTED-AVERAGE
LEASE TERM
6 Annual Report 2013 Annual Report 2013 7
INDUSTRIAL
RETAIL
OFFICE
PORTFOLIO ASSETS
ARTIS REIT
Govern-ment & National
64%
Regional & Local
36%
DIRECTV BUILDING, DENVER CO
PTI BUILDING, EDMONTON AB
In 2013, we accessed the capital markets raising $172.5
million of equity in a public offering of units and $180.0
million through two preferred unit offerings. We finished
the year with ample liquidity, including $48.2 million of cash
on hand and $80.0 million available on our revolving term
credit facility.
We have worked hard to improve the financial strength
of the balance sheet and successfully decreased our ratio
of mortgages, loans and bank indebtedness to GBV and
our total debt to GBV as of December 31, 2013 to 45.4%
and 49.0%, respectively. At the same time, we reduced our
weighted-average effective rate of interest to 4.27% from
4.42% last year and improved our interest coverage ratio to
2.82 times from 2.45 times last year.
As a result of our successful acquisition program and internal
growth strategy, our financial results in 2013 improved
significantly. Top line revenue was up 24.4% and Property
NOI was up 23.5% compared to last year. AFFO, which is
a key financial measure for REITs in Canada, increased to
$1.26 per unit in 2013, an impressive 9.6% increase over last
year. Artis has provided a stable monthly distribution to
unitholders since inception, which is currently set at $1.08
per annum. Our AFFO payout ratio based on our current
distribution rate also improved significantly, decreasing
from 93.9% in 2012 to 85.7% in 2013.
Artis is one of a select few REITs and real estate operating
companies in Canada that has earned a BBB (L) & Pfd-3 (L)
rating from DBRS. The basis for the rating from DBRS is
a result of having an impressive financial profile and credit
matrix, a fully diversified commercial portfolio by asset
type and geography and having a portfolio of commercial
properties that continually improve in quality with each new
acquisition. Artis’ portfolio has a diverse tenant roster with
a majority of investment grade national and government
tenants.
8 Annual Report 2013 Annual Report 2013 9
DIRECTV BUILDING, DENVER, CO
QUARRY PARK, CALGARY, AB
STRONG FINANCIAL POSITION
2014
ARTIS IS ONE OF A SELECT FEW PUBLIC COMPANIES IN CANADA’S REAL ESTATE SECTOR WITH AN INVESTMENT GRADE CREDIT RATING
ARTIS REIT
AFFO PER UNIT
INCREASED AN
IMPRESSIVE
9.6% OVER
LAST YEAR
ARTIS’ MANAGEMENT TEAM
800 5TH AVE., CALGARY, AB
In 2014 and for the foreseeable future, Artis will continue to
focus on internal growth opportunities, extracting maximum
financial value from our existing commercial properties by
capitalizing on below-market rent opportunities, through
selective redevelopment and repositioning of well-located
assets in primary markets, and from new construction and
expansions of existing portfolio properties.
We selectively pursue opportunities to make accretive
acquisitions in Canada and the U.S. in our select markets.
We will continue to be deliberate in our acquisition
strategy, only acquiring assets that improve the quality of
the overall portfolio and continue to improve our financial
performance.
We expect the debt and equity markets to be healthy in
2014. Interest rates should continue to fluctuate moderately
at their historical lows and there will continue to be
opportunities to term out debt at very attractive low long
term financing rates.
We start 2014 with significant liquidity on the balance
sheet, an investment grade credit rating, and a proven track
record of raising capital efficiently. We expect Artis will
have capacity and flexibility to execute on our disciplined
growth strategy again in 2014.
OUTLOOK
Dave JohnsonSenior Vice-PresidentAsset Management(Central Canada/U.S. Region)
Doug McGregorSenior Vice-PresidentSpecial Projects(Western Region)
John MahSenior Vice-PresidentAsset Management(Eastern Region)
Frank SherlockSenior Vice-PresidentProperty Management
Dennis WongSenior Vice-PresidentAsset Management(Western Region)
Brad GoerzenVice-PresidentLeasing (Central Canada & U.S. Region)
Annual Report 2013 11
605 WATERFORD PARK, PLYMOUTH, MN
ARTIS NAMED ONE OF MANITOBA’S TOP 25 EMPLOYERSFOR 2014
94RATING
ARTIS REIT
OVER $200 MILLION WORTH OF DEVELOPMENT PROJECTS IN THE PIPELINE
Armin MartensPresident and C.E.O.
Jim GreenC.F.O.
Kirsty StevensC.A.O.
ARTIS’ EXECUTIVE TEAM
Readers are cautioned that this Annual Report may contain forward-
looking statements. Artis cannot assure investors that actual results
will be consistent with any forward-looking statements and assumes
no obligation to update or revise such forward-looking statements
to reflect actual events or new circumstances. All forward-looking
statements contained in this Annual Report are qualified by this
cautionary statement. Refer to Artis’ MD&A for full forward looking
disclaimer.
Philip MartensVice-PresidentAsset Management(U.S. Region)
Kim RileyVice-PresidentAcquisitions and Due Diligence
Bruce NimmoVice-PresidentLeasing (Western Region)
12 Annual Report 2013
Artis’ Trustees are proven business leaders with significant breadth of experience in the areas of real estate, finance,
securities, investments and law; they also bring other public company board experience to the table. The Board has
three committees: the Audit Committee (Chaired by Delmore Crewson, FCA), the Governance and Compensation
Committee (Chaired by Edward Warkentin, LL.B.), and the Investment Committee (Chaired by Wayne Townsend, CFP).
Each committee’s members are independent of management. The Disclosure Committee is a sub-committee of the
Governance and Compensation Committee (Chaired by Edward Warkentin).
Additional information about Artis’ Board, Trustees and committees, as well as key governance documents such as the Code of
Conduct, Whistleblower Policy, Board Mandate and Declaration of Trust can be downloaded from the company’s web site at:
www.artisreit.com/about-us/corporate-governance/
CORPORATE GOVERNANCE
ARTIS’ TRUSTEES
CORPORATE SUSTAINABILITYArtis is committed to minimizing potential adverse effects on the environment and promoting the use of energy
efficient tenant practices in our buildings. We acquire energy certified buildings and target advancements in
certification levels in our portfolio properties. The three major property certifications we pursue are:
(1) AUDIT
COMMITTEE
(2) INVESTMENT
COMMITTEE
(3) GOVERNANCE
AND
COMPENSATION
COMMITTEE
(4) DISCLOSURE
COMMITTEE
(5) NEW
INDEPENDENT
TRUSTEE,
APPOINTED
FEBRUARY 27, 2014
LEED or
Leadership
in Energy &
Environmental Design is a green building
tool that addresses the entire building
lifecycle recognizing best-in-class
building strategies.
ENERGY STAR is a voluntary
U.S. Environmental
Protection Agency (EPA)
program that certifies buildings in the
U.S. for superior energy performance.
BOMA or the Building Owners and
Managers Association promotes
energy efficiency and sustainability
for new and existing buildings, by
assigning certification levels based on
achievement of energy target.
Armin MartensPresident and C.E.O.(4)
Edward WarkentinChairman(2) (3) (4)
Delmore Crewson(1) (2)
Patrick Ryan(1)
Victor Thielmann(1) (3)
Cornelius Martens
Wayne Townsend(2) (3)
Ron Rimer(5)
FUNDS FROM OPERATIONSPER UNIT
2011 2012 2013
$1.21
$1.30 $1.46
REVENUESMILLIONS
2011 2012 2013
$290.5
$372.5
$463.4
TOTAL ASSETSMILLIONS
2011 2012 2013
$3,167.6
$4,380.1
GROWTH HIGHLIGHTS
INVESTOR HIGHLIGHTS FINANCIAL HIGHLIGHTS
2013 2012%
CHANGE
REVENUE 463,418 372,469 24.4%
PROPERTY NET OPERATING INCOME(PROPERTY NOI) 296,882 240,409 23.5%
FUNDS FROM OPERATIONS (FFO) 183,467 140,146 30.9%
FFO PER UNIT 1.46 1.30 12.3%
FFO PAYOUT RATIO 74.0% 83.1% 9.1%
ADJUSTED FUNDS FROM OPERATIONS (AFFO) 156,761 122,702 27.8%
AFFO PER UNIT 1.26 1.15 9.6%
AFFO PAYOUT RATIO 85.7% 93.9% 8.2%
DISTRIBUTIONS PER UNIT 1.08 1.08 -
GROSS BOOK VALUE (“GBV”) 5,043,254 4,380,766 15.1%
MORTGAGES, LOANS AND BANK INDEBTEDNESS TO GBV 45.4% 47.3% 1.9%
($000’S EXCEPT PER UNIT AMOUNTS)
TRANSFER AGENTCST Trust CompanyPhone: 1.416.682.3860 or 1.800.387.0825Toll Free throughout North AmericaFax 1.888.249.6189canstockta.ca
INDENTURE TRUSTEEBNY Trust Company of CanadaPhone 1.800.254.2826Fax 1.416.360.1711bnymellon.com
AUDITORSDeloitte LLP
LEGAL COUNSELAikins, MacAulay & Thorvaldson LLP
STOCK EXCHANGE LISTINGS
Toronto Stock Exchange
Trust Units AX.UN
Preferred Units Series A AX.PR.A Series C AX.PR.U Series E AX.PR.E Series G AX.PR.G
Convertible Debentures Series F AX.DB.F Series G AX.DB.U
2013 DISTRIBUTIONS
Trust Units$0.09 per unit per month
Series A Preferred Units$0.328125 per unit per quarter
Series C Preferred UnitsUS$0.328125 per unit per quarter
Series E Preferred Units$0.328600 per unit for the initial period ended June 28, 2013$0.296875 per unit for the quarters ended September 30, 2013 and December 31, 2013
Series G Preferred Units$0.321900 per unit for the initial period ended October 31, 2013
2013 TAXABILITY OF DISTRIBUTIONS
88% of distributions to Unitholders and preferred Unitholders in the taxation year were classified as return of capital. 11.64% was classified as investment income and 0.36% was classified as capital gains.
INVESTOR [email protected]: 1-800-941-4751
Artis Real Estate Investment Trust 13
CORPORATE INFORMATION
• WELL DIVERSIFIED CANADIAN COMMERCIAL REIT
• 25 MILLION SQUARE FEET OF OFFICE, RETAIL AND
INDUSTRIAL SPACE
• OVER 230 PROPERTIES IN WESTERN CANADA, CENTRAL
CANADA AND SELECT U.S. MARKETS
• TSX-LISTED REIT OFFERING A SELECTION OF EQUITY INVESTMENT OPTIONS FOR INVESTORS
• TRUST UNITS EARN A STABLE AND TAX-EFFICIENT
MONTHLY DISTRIBUTION OF $1.08 PER UNIT PER ANNUM
• PREFERRED UNITS EARN A STABLE TAX-EFFICIENT
QUARTERLY DISTRIBUTION, IN CANADIAN AND IN SOME
CASES U.S. DOLLARS
• PROVEN TRACK RECORD OF ACCRETIVE GROWTH: 2011 - 2013
• 59% INCREASE IN ASSETS
• 60% INCREASE IN REVENUES
• 21% INCREASE IN FUNDS FROM OPERATIONS PER UNIT
• STRONG FINANCIAL POSITION
• INVESTMENT GRADE CREDIT RATING OF BBB (L) AND
PFD-3 (L) FROM DBRS
• DECREASING LEVERAGE AND PAYOUT RATIOS
• AMPLE CASH AND BORROWING CAPACITY
The information in this Annual Report should be read in conjunction with the REIT’s audited annual
consolidated financial statements and management’s discussion and analysis for the years ended
December 31, 2013 and 2012. These documents are available at www.sedar.com or on our web site at
www.artisreit.com.
Retail26%
Office50%
Industrial24%
ASSET CLASS DIVERSIFICATION(1)
AB39%
BC9%
MB12%
SK7%
ON13%
U.S. 20%
GEOGRAPHICAL DIVERSIFICATION(1)
$5,042.0
YEAR ENDED DECEMBER 31
(1) share of 2013 annual property NOI ANNUAL GENERAL MEETING
Main Floor Conference Centre360 Main StreetWinnipeg, Manitoba
Thursday, June 19, 201411:00 a.m. C.T.
CALGARY
Suite 660, 1509 Centre Street SWCalgary, Alberta T2G 2E6T 403.705.3535 F 403.444.5053
EDMONTON
Suite 101, 13245-140th Avenue NWEdmonton, Alberta T6V 0E4T 780.702.3066 F 780.702.3070
WINNIPEG HEAD OFFICE
300 - 360 Main StreetWinnipeg, Manitoba R3C 3Z3T 204.947.1250 F 204.947.0453
TORONTO
Suite 1802, 415 Yonge StreetToronto, Ontario M5B 2E7T 647.955.3755 F 647.977.9072
PHOENIX
Suite 280,16220 N. Scottsdale RoadScottsdale, Arizona 85254T 480.483.4111 F 480.556.9987
www.artisreit.comAX.UN - TSX
STAMPEDE STATION, CALGARY, AB
NORTH SCOTTSDALE CORPORATE CENTER II, SCOTTSDALE, AZ
TWO MARKETPOINTE, MINNEAPOLIS, MN
TABLE OF CONTENTS
01 Message to Unitholders
03 Internal Growth Strategy
04 External Growth Strategy
06 Portfolio Assets
09 Strong Financial Position
10 Artis’ Executive Team
11 Outlook12 Artis’ Trustees, Corporate
Governance and Sustainability13 Corporate Information
ANNUAL REPORT 2013
ARTIS REAL ESTATE INVESTMENT TRUST
ON THE COVER:MAX AT KIERLAND, SCOTTSDALE, AZ
99RATING
PROPERTIES OF SUCCESS
77RATING
94RATING
Artis is one of the largest diversified commercial real estate investment trusts in Canada. Over the last 10 years, Artis has executed an aggressive but disciplined growth strategy, building a portfolio of office, retail and industrial properties in Canada and select U.S. markets with a major concentration in Western Canada.
Artis’ external growth strategy is to pursue high-quality accretive acquisitions, and when prudent, to invest in high-yield development opportunities in our established target markets. Artis’ internal growth strategy is to extract maximum financial value from our existing commercial properties by capitalizing on below-market rent opportunities, through selective redevelopment and repositioning of well-located assets in primary markets, and from new construction and expansion of existing portfolio properties.
COMPANY PROFILE